Industry growth stays weak in February

Monthly industrial output in Ukraine increased 1.6% yoy and 0.4% mom in February, Ukrstat reported on Friday. Growth across sectors was mixed, with chemical and utilities sectors being the main drivers, adding 15.0% yoy and 12.3% yoy, respectively thanks to a low base effect. Food and machinery increased just 0.8% yoy and 0.2% yoy, while metallurgy remained in the red for the third consecutive month (-3.8% yoy in February).

Svetlana Rekrut: The year-on-year figures were extremely weak last month, even though this February had one work day more than last year’s. Apparently, weakness in external demand is taking a toll on core Ukrainian industries. Lackluster industry growth was also partially due to abnormally cold temperatures that disrupted transportation. We expect industrial production to grow a mere 2.9% in 2012, following healthy 7.6% yoy growth in 2011.